Merrex Gold corporate update
HALIFAX, NOVA SCOTIA–(Marketwire – Aug. 13, 2012) – Gregory Isenor, P.Geo., President and CEO of Merrex Gold Inc. ("Merrex") (TSX VENTURE:MXI) is pleased to provide the following corporate update.
Siribaya Gold Project
The 2012 exploration program progressed successfully at the Siribaya Gold Project notwithstanding an unavoidable temporary drilling interruption (March 27 – June 25) caused by increased insurgent activity in northern Mali and the March military coup. The political situation in Mali appears now to have stabilized under a blended military and civilian government and the Ministry of Mines and the National Directorate of Geology and Mining (DNGM) are operating normally.
Diamond drilling resumed June 25, 2012. This drilling activity was completed in the southern region of the 1A structure in the area of impressive RC drill results. Drilling continued with six holes completed, until July 14th when seasonal rains forced a temporary suspension. Drilling is expected to resume after the end of the rains in the latter part of October. During this period of seasonal rains meetings are planned with the project operator, Iamgold, to review all results to date and plan the next phases of exploration. Merrex will update shareholders with the proposed program when it is available.
Auger drilling had also resumed at Siribaya, on the Siribaya Ouest structure, a new area west of Bambadinka. Drilling was focused on untested gold anomalies identified by soil and termite mound geochemistry. Auger drilling results will assist target identification for future RC and diamond drilling campaigns.
The 2012 termite sampling program was completed during the drilling suspension period with 29,669 samples collected on Babara (5,941 samples), Kofia (6,811 samples), Taya-Maléa (6,648 samples), Siribaya Ouest (6,930 samples) and Kambaya (3,339 samples) permits. This data is being compiled and interpreted.
On July 30, 2012 Merrex released an updated NI43-101 compliant mineral resource estimate for its Siribaya Gold Project increasing the resource to 303,900 ounces Indicated grading 2.34 g/t and 301,000 ounces Inferred grading 2.17 g/t. The resource estimate incorporates 165 diamond drill holes and 483 reverse circulation drill holes completed prior to June 2012. The resource area includes approximately 1 kilometre along strike within the 1B structure and intermittently over approximately 4 kilometres of strike length within the 1A structure. Each of the 1A and 1B structures is mineralized over approximately 10.5 kilometres of strike length. In all regions the resources remain open at depth, and north and south along strike. For details of the resource estimate see news release dated July 30, 2012 with particular emphasis on the attached map (to view the map associated with this press release, please visit the following link: http://media3.marketwire.com/docs/Resource_Estimate_Map.pdf) showing the resource block which clearly illustrates that more drilling is required to generate a larger resource. The Siribaya Gold Project is a major exploration area with extensive target areas both within the Siribaya structure and in the numerous target areas beyond the Siribaya structure. It is expected is that continued exploration will result in increases in the Siribaya resource as well as generating new discoveries in other areas.
It is planned that an update on the drilling programs and additional drill results for DD, RC and Auger will be released during the summer months.
The Siribaya Gold Project is a joint Merrex-IAMGOLD exploration project in West Mali comprised of approximately 850 square kilometres of gold-prolific exploration permits and permits applications pending where exploration expenditures to date exceed $28 million. IAMGOLD has advised that the required $10.5 million of exploration expenditures under the terms of the Earn In Option Agreement has been completed and that subject to a final accounting review which is nearing completion, IAMGOLD will formally vest with a 50% interest in the land package. Exploration of the Siribaya Gold Project is ongoing under a joint management committee. A total of 75,000 metres of drilling (Reverse Circulation, Diamond and Auger) is planned for 2012 at a budgeted expenditure of $11.86 million before contractual overhead fees. However, given the drilling interruption it is anticipated that the total planned program metreage will not be reached during calendar year 2012.
The Kakadian gold permit located in western Mali is a 27.25 km2 permit with a contiguous 27.25 km2 permit application pending. A 2012 exploration program comprised of 50 pits is underway to follow up on termite mound and soil geochemistry gold anomalies in the South East portion of the permit area. Results will be released when available.
Jubilee Zinc and Irish Zinc Projects
Exploration expenditures at the Jubilee Zinc Project have been limited to basic assessment work programs sufficient to satisfy Nova Scotia mineral claims maintenance requirements. Merrex has negotiated an agreement with neighbouring landowners to secure exploration rights to a larger permit area with several untested structures.
Additionally, to supplement the value of the Jubilee Zinc Project and enhance the attractiveness of Merrex's zinc package, Merrex acquired by application four blocks of well-located, highly prospective zinc exploration permits totalling 1, 043 km2 in the Republic of Ireland. A limited program of historical data review and evaluation to determine future exploration programs is underway.
Efforts are being made to increase shareholder value by divesting Merrex's zinc assets.
At the end of the calendar Q3 2012 Merrex will have approximately $2,500,000 cash on hand. Merrex has been reducing costs during this time of uncertain market conditions and will be in a sound financial position into 2013.
Merrex has retained National Bank Financial Inc. as a financial advisor with a broad mandate to advise on financing alternatives and strategies to increase shareholder value. National Bank Financial Inc.'s engagement was not in response to any approaches made to the Company.
For further details about Merrex Gold's exploration activities visit Merrex's website at www.merrexgold.com.
To be added to Merrex's email contact list please email your request to [email protected].
Gregory P. Isenor, P. Geo., is the Qualified Person as defined under NI 43-101 who has reviewed and is responsible for the technical information presented in this news release.
Merrex is primarily a Mali focused gold exploration company with experienced management, a solid exploration team, a prominent gold-producer as a partner and an expanding gold resource … a winning combination offering investors an extraordinary opportunity.
Please visit our website at www.merrexgold.com for the most recent corporate presentation.
On Behalf of the Board
Gregory Isenor, P.Geo., President & CEO
This press release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future exploration drilling, exploration activities and events or developments that the Company expects, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.